If you are stuck in such a situation, here is what to do.

Mr. Anand Sharma, a resident of Janakpuri, found himself in a difficult position. In early 2023, he lent a sum of ₹25,000 to his friend, Mr. Vivek Singh, who claimed he needed the money for an urgent family medical emergency. Trusting his friend, Mr. Sharma transferred the amount without any formal paperwork.

For nearly a year, Mr. Sharma’s requests for repayment were met with a series of excuses and broken promises. Mr. Singh would consistently promise to pay by a certain date, only to defer it when the day arrived. Frustrated, Mr. Sharma contacted Mr. Singh’s father, Mr. Ramesh Singh, to explain the situation. This led to a partial payment of ₹7,000. However, the intervention backfired. An enraged Mr. Singh called Mr. Sharma, threatening him for involving his family and declaring he would not pay the remaining ₹18,000. Since then, both Mr. Singh and his father have been ignoring Mr. Sharma’s calls, leaving him with a financial loss and a sense of betrayal.

Advice in such cases

When a friendly loan turns sour and involves threats, you have several legal avenues to explore. It is crucial to act methodically to build a strong case.

• Gather all documentary proof of the transaction, such as bank statements, UPI transaction details, or screenshots of the payment.
• Compile all communication related to the loan, including WhatsApp chats, SMS messages, or emails where the borrower acknowledges the debt or promises repayment.
• Send a formal Legal Notice through a lawyer demanding the repayment of the outstanding amount. This is often the first official step and can sometimes lead to a resolution without going to court.
• If the notice is ignored, you can file a civil suit for recovery of money. A summary suit under Order XXXVII of the Civil Procedure Code, 1908, can be a faster option if you have clear written proof like a promissory note or acknowledged messages.
• If there was an element of deception from the beginning and subsequent threats, you can also file a police complaint.
• Consult with Lawyer: The very basic and important step to start is talk to Lawyer / advocate. You should not hesitate in paying his consultation fee i.e. might be in range of Rs. 10,000 to 50,000 depends case to case. He is helping you in this situation of come out. He is expert in the domain and can help you explain the procedure which you might have never explored. A good lawyer can get the issues resolved much faster than you think.

Applicable Sections of Law

This situation involves both civil and criminal aspects under Indian law.

• Civil Remedy: The primary remedy is a suit for recovery of money, which can be filed in a civil court having the appropriate jurisdiction. If there is a written agreement, a summary suit under Order XXXVII of the Code of Civil Procedure, 1908, is advisable for a speedier trial.
• Criminal Remedy (Bharatiya Nyaya Sanhita, 2023 – BNS):
• Section 318 of BNS (Cheating): If it can be proven that the borrower had no intention of repaying the loan from the very beginning and fraudulently induced you to lend the money, it constitutes the offence of cheating.
• Section 351 of BNS (Criminal Intimidation): The threats made by the borrower to deter you from seeking repayment fall under criminal intimidation, which is a punishable offence.

If you are the complainant

As the person who has lent the money, you must take certain steps to protect your interests.

• Preserve all evidence meticulously. Do not delete any chats or messages, even if they seem insignificant.
• Keep a timeline of events: when the money was lent, when repayments were promised, and when threats were made.
• Do not engage in heated arguments or use abusive language with the borrower, as this could weaken your position.
• Consult with Lawyer: The very basic and important step to start is talk to Lawyer / advocate. You should not hesitate in paying his consultation fee i.e. might be in range of Rs. 10,000 to 50,000 depends case to case. He is helping you in this situation of come out. He is expert in the domain and can help you explain the procedure which you might have never explored. A good lawyer can get the issues resolved much faster than you think.

If you are the victim

Being a victim of financial deceit and intimidation by a friend can be emotionally distressing. It’s important to separate the emotional betrayal from the legal facts.

• Acknowledge the breach of trust but focus on the legal steps required for recovery.
• Do not be swayed by emotional blackmail or threats. The law is on your side if you have the evidence.
• If the threats make you feel unsafe, mention this clearly in your police complaint. Your safety is paramount.
• Consult with Lawyer: The very basic and important step to start is talk to Lawyer / advocate. You should not hesitate in paying his consultation fee i.e. might be in range of Rs. 10,000 to 50,000 depends case to case. He is helping you in this situation of come out. He is expert in the domain and can help you explain the procedure which you might have never explored. A good lawyer can get the issues resolved much faster than you think.

How the police behave in such cases

Often, the police may initially view such matters as purely civil disputes and advise you to approach the court directly. They might be hesitant to file a First Information Report (FIR), especially if the element of cheating is not immediately apparent.

However, under the provisions of the Bharatiya Nagarik Suraksha Sanhita, 2023 (BNSS), if your complaint clearly discloses a cognizable offence like cheating (Section 318 BNS) and criminal intimidation (Section 351 BNS), the police are bound to register an FIR. A well-drafted complaint, submitted through a lawyer, highlighting the criminal elements of deception and threats, can compel the police to take action.

FAQs people normally have

Can I file a case without a written agreement?

Yes, you can. While a written agreement is best, other evidence like bank transaction records, WhatsApp chats, or emails where the loan is acknowledged are legally valid and can be used to prove your case in court.

Is it worth pursuing legal action for a relatively small amount?

This is a personal decision. Sometimes, sending a strong legal notice is enough to recover the money. Filing a case is also a matter of principle against being cheated and intimidated. The legal costs should be weighed against the amount owed and the principle involved.

What evidence is required?

The stronger your evidence, the better your chances of success. Key pieces of evidence include:

• Proof of money transfer: Bank statements, UPI transaction IDs, or a signed receipt.
• Communication records: Screenshots of WhatsApp/SMS chats or emails where the borrower asks for the loan, acknowledges receiving it, or promises to repay.
• Witnesses: If someone was present during the transaction or conversations about the loan, their testimony can be valuable.
• Call recordings: If legally permissible and obtained in your state, recordings of conversations can serve as strong evidence.

How long will the investigation take?

The timeline can vary significantly. A legal notice might resolve the issue within 15-30 days. A summary civil suit can be decided in a few months if the defendant does not have a strong defense. A regular civil suit can take a few years. In a criminal case, a police investigation and the filing of a chargesheet can take several months, after which the court trial begins.

Advocate Sudhir Rao, Supreme Court of India